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Nazi Holocaust

Financial compensation
for Nazi slave laborers

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Overview

During World War II, millions of Jews, Roma (Gypsies), Poles,
other Eastern Europeans, and people of other nationalities and religions were forced to
work under inhuman conditions in Nazi industry as slave laborers. Many did not
survive, and became part of the Nazi Holocaust (a.k.a. the Shoah; the Devouring).

Philip Mendlowicz is a Polish Jew who was a slave laborer at Volkswagen. He
now lives in North York, ON, Canada. He commented:

"They wanted you to
be an animal. They didn't care if you fell down sick. They sent you to the death
camp. There were always more to take your place." 8

We have been unable to find any reference of money having been paid in the
past as compensation to former slave laborers. Although Germany has paid out
nearly $90 billion in restitution to certain survivors of the Nazi regime, none
had apparently been directed to slave laborers.

A final agreement was reached in which the government and
certain industries in Germany will equally finance a $7.5 billion (U.S.) fund
was dispersed to victims of Nazi persecution.

Some estimates are:

A total of 8 to 12 million slaves worked for the Nazi war machine.

1.5 to 2 million have survived to 1999.

The average slave worked for about 7,000 hours over a two year
period. 10

The average age of a survivor in 1999 was almost 80.

A formal claims resolution mechanism was scheduled to be launched in mid
2000-JAN.

Payments were scheduled to begin by the end of the year 2000.

Ford Werke A.G.

On 1998-MAR-4, Elsa Iwanowa filed a
federal class action suit against the Ford Motor Company and Ford Werke A.G. She was
allegedly employed as a slave laborer in a Ford manufacturing plant in Cologne, Germany,
during World War II. She seeks "reasonable payment for the work performed and the
disgorgement of unfair profits." 4Records show that
slave labor accounted for as many as half the workers at the Cologne plant. Slave workers
at the Ford plant allegedly lived in:

"wooden huts, without running water, heat or
storage. Locked in the huts at night, the workers, mostly adolescent children, slept in
three-tiered wooden bunks without bedding. Food consisted of two paltry meals a day.
Workers who became ill were sent to Buchenwald concentration camp. Failure to meet
production quotas led to beatings from Ford security officers or other plant workers."
5

Ford Motor Company (USA) owned from 55 to 90% of the shares of its subsidiary Ford
Werke A.G. during 1933 to 1945. "Edsel Ford and Robert Sorenson, high-ranking
officials of Ford Motor Company, served as directors of Ford Werke A.G. throughout the
Nazi Third Reich." 4 The lawsuit alleges that the
company made immense profits providing the German army with tracked vehicles and other
trucks. This was because it worked at peak capacity for many years, and did not have
to pay wages to many of its workers. Unlike most American facilities in Germany, Ford was
not taken over by the German government during the war. Ford and Hitler seems to have had
a friendly relationship. "On Henry Ford's 75th birthday in 1938, Hitler awarded
Ford the 'Great Cross of the German Order of the Eagle' for Henry Ford's publication of
the notorious anti-Semitic pamphlet, 'The International Jew, a Worldwide Problem' [Berlin,
1921]."

Other German companies

During 1998-AUG, a number of other U.S.
lawsuits were launched by survivors against a variety of German companies, including Audi,
BMW, Daimler-Benz, Siemens, Leica Camera and Volkswagen. The matter came to
a head in 1998 when the largest bank in Germany, Deutsche Bank, made a bid of $15
billion U.S. to take over Banker's Trust in New York. New York state authorities
threatened to block the takeover unless the slavery compensation issue was satisfactorily
resolved.

For years, Chancellor Helmut Kohl had maintained that Germany companies which used slave
labor should not have to compensate their victims. This was because the companies were merely following Nazi
government orders that they
employ slave labor. That argument is similar to one raised at the Nuremberg
trials shortly after Word War II: that an officer was is not responsible for
mass murder because he was simply following the orders of his superior officers.
The court rejected that line of reasoning.

After the 1998 elections, the newly elected government reversed this stance and pledged
to set up foundations to handle financial compensation. 1
Twelve German industrial giants (Allianz, BASF, Bayer, BMW, Daimler Chrysler,
Degussa-Huels, Dresdner Bank, Fred Krupp, Hoesch Krupp, Hoechst, Siemens, and
Volkswagen) met with German Chancellor Gerhard Schroeder in 1999-FEB. They later
announced the establishment of a fund to pay their victims. News reports speculate that it
might have amounted to about 3 billion German Marks, or 2.6 billion US dollars. 2
Chancellor Schroeder saw the fund as a win-win situation for both surviving Nazi victims
and German industry. He said: "for those [victims] in the final years of their
lives, it will...provide them with a little more means that they would otherwise have had."
German industry will probably save money because the companies would expect to
be given immunity from future class-action lawsuits. Paying into a multi-billion dollar fund is probably cheaper than
meeting any future financial awards by the courts.

During World War II, the IG Farben chemical company manufactured the deadly
Zyklon B gas that was used to kill millions of victims in Nazi gas chambers. Although IG
Farben founded much of the present German chemical sector, the company itself is now being phased
out. They will establish a separate foundation of several million marks to compensate
slave laborers. Liquidator Volker Pollehn commented: "This is a new beginning for
IG Farben."

Developments in Germany

1999-MAY-9: Four men and women filed a lawsuit in Stuttgart, Germany, against Bosch,
a major car parts manufacturer. IG Metall, a German trade union, released a statement
saying that "Hunger and inhuman treatment with serious damage to health and
psychological complaints were part of day-to-day life with insufficient treatment for
illness." Three people are also suing Daimler-Chrysler for being enslaved by
Diamler-Benz in 1944-5.7

1999-AUG-29: The German government announced that it would pressure
reluctant companies to contribute to the compensation fund. Count Otto
Lambsdorff is Germany's representative in talks with the U.S. government and
various victims' groups. He speculated that if the talks which are scheduled
to resume in 1999-OCT failed that "there would be
boycotts and sanctions on German products across the United States and in
individual states."

Deutsche Bank AG and three other large companies offered to contribute
to the fund. This brings the total of cooperative German companies to 16.
However, there were thousands of other companies during World War II who
used slave labor, but which have made no offers to date.

Volkswagan has agreed to pay each of its ex-slaves the equivalent of about
$3,500 in U.S. funds. If this value is accepted by German industry generally,
then a compensation fund of 6 or 7 billion would be needed. This is apparently
many times the amount that had been pledged.

1999-OCT-5: Organizations that represent survivors of Nazi-era
slave labor placed newspaper ads and held press conferences in order to
publicize their plight. One ad which targets Ford said: "We were
treated like animals." Another said: "Bayer [haggled] over
the purchase price of 150 female prisoners on whim to test a sleeping
medication...Bayer found $80 per woman too high a price. They ultimately
bought them for less."Rudy Kennedy, a survivor from London,
said during a B'nai Brith news conference: "The corporations who
exploited us and who, in genocidal partnership with the SS, murdered our
friends and relatives have grown rich...They are worth countless billions."
Neither side appears willing to talk in terms of compensation amounts. One
rumor is that the German businesses were willing to pay 3.8 billion and that
the survivors had asked for 20 billion. Both figures have been denied. 9

1999-DEC-14: TheGermany government and industries
reached a tentative settlement. They will contribute about 5.14
billion dollars (in U.S. funds) into a fund to be distributed among
the estimated 1.5 to 2 million survivors. The agreement was to be
finalized on DEC-17.

1999-DEC-15: Survivor groups met in Berlin.
They were expected to approve the compensation deal that was reached on
DEC-14. They had hoped that payments of up to $7,700 US each would
have started by mid-2000.

2000-JUL-17: A compensation fund totaling about $7.5 billion
(US) was created after a very difficult 18 months of negotiation.
Representatives of Germany, Israel, Russia, the U.S., four eastern
European countries, the Jewish Claims Conference and lawyers for the
victims signed documents creating the fund. German Chancellor
Schroeder said: "This closes one of the last open chapters of
the Nazi past. We are setting down a durable marker of historical and
moral responsibility." The German government planned to transfer
$3.75 billion to the fund during that year. 3,127
German firms have pledged about $2.4 billion. 11

2000-JUL-27: The Evangelical Church in Germany (EKD)
is the main Protestant denomination in Germany. During the 1930's,
they cooperated extensively with Nazism. However, a small number of
theologians, clergy and laity left to form the Confessing Church
which opposed the Nazi's. During the Nazi era, the EKD and the main
Protestant social-service organization, Dikonisches Werk exploited
slave laborers in church parishes, and diaconal institutions such as
church-run hospitals. The EKD and DW have admitted that they used
slave labor and agreed to contribute 10 million Deutschmarks (about
4.7 million in U.S. dollars) to the main compensation fund, thus
increasing the fund by about 0.06%. 12

2000-JUL-27: The Roman Catholic Church in Germany has refused
to contribute to the fund. They have stated that there is no evidence
that slave laborers were used in Roman Catholic institutions. "However,
a German television station is about to broadcast allegations that
forced laborers from Poland and Ukraine were sent to work at a
Catholic monastery and a theological seminary, and that prisoners from
a concentration camp were forced to work in a church institution."
12

2001-JUN-2: The Bundestag, Germany's lower house, voted
overwhelmingly to unblock a $4.5 billion (US) fund, thus ending months
of legal wrangling. Otto Lambsdorff, the top German negotiator on the
fund, said: "We have to put a financial full stop to the darkest
chapter of our history. [However,] There cannot and must not be a
moral full stop. To date, 6,351 German firms had contributed to the
fund. Those who were held in camps or ghettos were entitled to about
$7,000; those forced to work in factories were eligible for $2,200.13

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Austria:

Edward D. Fagan, an American lawyer, and Michael Witti, a German lawyer accused three
Austrian companies of using slave labor during Nazi rule. The three are: Lenzing,
a viscose manufacturer; Steyr-Daimler-Puch, a vehicle assembler; and Voest-Alpine,
a large industrial organization which has since been divided into several companies. The
lawyer urged that the companies pay compensation to their alleged former victims rather
than get embroiled in an expensive law suit.3

Edward Fagan said that companies that "employed" slave labor had records
showing the names of the workers, their concentration camp or factory, and for how long
they worked. He said:

"We will not stop until we have recovered the lists and
followed the money, and it is not going to end here in Austria. This will go on and on
until the last penny has been divested from the people and the companies to which it does
not belong."

Ethical questions:

Nazi slave labor raises a number of questions:

Should half a century old claims still be heard by today's courts?

Should today's stockholders pay for human rights abuses committed decades ago; in some
cases, before they were born?

Should companies be held responsible for events that they were ordered to perform during
wartime?

Ethics specialist, Margaret Somerville from the Centre for Medicine, Ethics and Law
at McGill University in Montreal believes:

"it would be wrong to exonerate
todays investors of responsibility for past injustices, since to some degree the
success of those companies has been built on the suffering of people many years ago."

Updated information:

The International Organization for Migration attempted to reach all potential claimants and to disperse compensation payments to successful applications. The filing deadline expired on 2001-DEC-31.

By 2005-JUL, the IOM had made full payments to more than 80,000 surviving victims of slave and forced labor under the Nazi regime. They had also paid out eligible claims for personal injury including medical experiments.14

Russ Laver, "Money and morality: Volkswagen has always insisted that it was
following orders from the Nazis to use slave labor," Maclean's Magazine,
1998-SEP-14. Available online at: http://www.quicken.ca/

For persons seeking justice, the PBS program Frontline has a list of contacts of groups
who help individuals seeking lost assets and bank accounts. It includes address, telephone
number, etc. for New York lawyer Edward D., mentioned above. (We received a
report that the Email address listed by PBS is no longer valid.) See: http://www.pbs.org/